Since education makes a person more likely to leave your region, how do you justify your investment in human capital?

Monday, May 16, 2016

Flat World of Finance

Whether global (more recently) or national, the location of certain professional services have defined the urban hierarchy. At the top are cities with F.I.RE. (finance, insurance, and real estate) industries. Finance in particular has come to define the latest era of globalization, with a few large cities dominating the sector. No more, FIRE is dying:

Forget the bright lights and fast pace of living in two of the world’s greatest metropolises, city living for a new generation of financial workers is now more Jacksonville in Florida and Warsaw in Poland than New York and London.

Instead of serving to attract top talent, New York and London price out financial firms in search of fatter bottom lines. High-end banking is no longer tethered to the strictures of the urban hierarchy. The world is, effectively, flat. Convergence defines the economic geography.

New York is reinventing itself once again, drawing on a different source of advantage, the unique assets that, regardless of the FIRE sector's future, will sustain it as a world city. Our intellectual, cultural and educational (ICE) strengths—already among the world's greatest—are becoming the essence of New York's global identity. The creative economy of New York is once again a gateway economy, as ICE assets originate here to influence and shape our world.

Speaking in one of his shiny new labs on the banks of Manhattan’s East River, André Choulika, chief executive of Cellectis, says he is a “big Boston fan”, but that the cut-throat competition for talent there would make it tough for a small company like his.

“In New York, you don’t have your employees hired when they go to buy their sandwich from the food truck, like in Boston,” he says.

For biotech, New York is to Boston as Jacksonville is to New York for finance. The city has enough assets to be a player. But it isn't the top dog in this ICE industry. It's the Small Apple.

1 comment:

Anonymous
said...

Boy this is some wacky stuff. Seems like a professor who is totally ensconsed in their own narrow, pigeonholed area. People see things from theory own perspective only. There are actually MANY perspectives for economic development, push pull factories. First, the writer seems to be horribly absorbed in US Ethnocentric thinking. Many do, but the US is not the only place on the planet with technology, industrial,and financial hubs. Though the world does suffer from a severe North South problem put in place by elites in largely Western countries. The entire denominator of pretexting things on nation states from 17th century Westphalian blueprints is very suspect in the 21st century. If this writer is serious about economic geography and development, he should familiarise himself with North work on open access societies. Second, technology is changing things in very unpredictable patterns and the entire concept of the internet replacing brick and mortar and especially jobs has been warped and misunderstood from the get go. Managers and investors frown on the 'work from home' concept except for the most portable of jobs, and even that is being reversed for QC reasons, and their will be no 'working in Lisbon, telecommute to London' for the masses, this fallacy is like absentee landlordism of the 21st century: a great concept but not practical, maybe never, the writer has weak understanding of human behaviour and HR. Read Senge, Pfieffer, Ulrich, Kochan, for a better understanding on risk reward and gaming systems with jobs. Writer: expand your horizon and denominators, there are many factors in play!